XMTrading: What is stop hunting? Countermeasure explanation


This article will explain how to win against stop hunting in XMTrading. In order to provide a highly safe and reliable trading environment, XMTrading strives to avoid any problematic behavior. However, there are rumors on the street that he is being stopped. Is this information true?

What is stop hunting?

Although it is not officially stated or mentioned, stop hunting is the act of manipulating the chart in order to intentionally activate the stop loss settings set by the trader. Naturally, when a stop loss is activated, the position is cut at a loss, so traders who encounter a stop loss will incur a loss. There are two types of stop hunting: patterns set by large traders and patterns set by FX traders. There is a possibility that the management is manipulating the rates, so I would like to compare them. We have summarized the information you should know when managing your funds. I recommend you to take a look once.

Stop hunting by big traders

As a basic rule, professional large-scale traders sometimes use market orders that are large enough to break through the price range where a large amount of stop loss is set at once, and use force, although it is risky. When a large order that causes a sudden change in the chart is placed, a large number of stop losses are activated at the same time, causing a chain of stop losses, which causes a large spike to occur in an instant. After that, the true direction will be revealed and you will be able to make a profit. Similar phenomena can be seen in various products, so it has become something like a rule.

Stop hunting by traders

A method in which a FX broker temporarily widens the spread to intentionally trigger a large number of stop losses, and manipulates the chart so that the stop loss is momentarily applied. If you have the knowledge and experience, you will understand that the spread that is usually around 1 to 2 pips can instantly expand to several hundred pips, triggering the stop loss and forcing the position to be liquidated. Stop-hunting, which is carried out by traders with thorough targeting, is clearly illegal, so there is no peace of mind, and there is no way to avoid it.

XM is not stop hunting

XM does not conduct stop hunting on its official website. There is no evidence of actual stop hunting. And currently, there are no reports of stoppages that would seriously shake the credibility of XM through word of mouth on social media. Stop hunting has disadvantages for investors and traders. For example, you may lose credibility, rumors spread that you are a malicious company, or you may be disliked by traders. Those FX brokers will be reported as malicious traders and you will be warned not to use them in the future.

Reasons why you may think you are stop hunting

XM is not doing stop hunting, but for some reason there are rumors that XM is also doing it. Why exactly is this? XM also holds a financial license, and zero cuts are also adopted. The reputation is very good. For individual investors, scalping and automated trading are allowed, and the support desk is very responsive, so it’s a reliable company with no troubles, but there are some strange rumors.

Influence of other companies

One reason is the influence of other Forex brokers. Because other Forex traders calmly start hunting for stops, the bad impression spreads throughout the Forex traders. There may be charts that some people find unnatural. As other Forex brokers keep running strange charts, users see that XM could do the same.

XM is NDD method

XM uses an appropriate NDD method that makes it extremely unlikely that intentional stop hunting will occur. To be precise, the NDD method is a method in which there is no dealer who manages customer orders, and the details are managed through a trading system and distributed to the market. Basically, since there is no human manipulation, there is no fraud, entry is extremely stable, and there is always no stoppage, resulting in a highly transparent execution method.

Stop hunting is likely to occur in DD traders

FX brokers and some overseas FX brokers use the DD method, and stop hunting is more likely to occur at DD method traders. DD companies sometimes do not send customer orders to interbanks, so what happens to the orders placed by traders is a black box. Even if someone deliberately widens the spread and causes a loss to a customer, there is no conclusive evidence left, so it cannot be determined, and it cannot be seen on the screen. There’s no way to win.

Timing that is easy to stop hunting

XM does not stop hunting, but it is possible to stop hunting by speculative moves, so be careful. It is an effective countermeasure to be aware of the timing when it is easy to stop hunting. At what point does this occur?

Currency pairs with low liquidity

It is said that stop hunting is likely to occur when trading in currency pairs with low liquidity. Currency pairs with low liquidity have low trading volumes, so large orders can easily cause price fluctuations. Stop hunting occurs because institutional investors can change prices.

Period of low liquidity

The illiquid market is the Asian market. There are no economic indicators during Asia time, and regions outside of Asia are generally asleep, so price fluctuations do not occur. During times when there are few trading participants, the trading volume is also low, so it may fluctuate rapidly if a large number of orders from institutional investors are received.

Price range where a large number of orders have accumulated

Be careful about the price range of the range. Price ranges where a large number of orders have accumulated are the most likely to be targeted. Once you get past the point, it’s easy to take a big direction all at once. If you break through the resistance line, you’ll be gone all at once.

key economic indicators and politics

Economic indicators are said to be prone to stop hunting. In a market where sudden fluctuations are likely to occur, stop hunting by speculators is likely to occur. It is better to avoid trading during these times in the first place, as they are fundamentally volatile. Also, pay attention to politics. When a war or civil war occurs, the market becomes quite chaotic. Sudden ups and downs are likely to occur. Traders should always keep a close eye on the news.


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